Assume that Japan and the United States frequently trade with each other. Under the freely floating exchange rate system, high inflation in the U.S. will place ____ pressure on Japanese yen, ____ the amount of Japanese yen available for sale, and result in ____ inflation in Japan.
A) upward; reduce; unchanged
B) upward; increase; higher
C) downward; reduce; unchanged
D) downward; increase; higher
Correct Answer:
Verified
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